Geographically and temporally, it is midway between Asia and the US, with easy access to all major European cities. Financially, it is a hub for international business deals and a reasonable flight for rich Saudi princes and wealthy Russian oligarchs. It attracts students from all over the globe, and its relative wealth to new EU members pulls in immigrants across Europe.

But for all that, there is a sometimes comforting, even infuriating, insularity. Why do some people living north of the Thames say they would never live south of it and vice-versa? Why do they grumble so much about their wonderfully extensive public transport system? And when it comes to nightlife, why do most people want to stay in their own neighbourhood and drink at their local pubs?

What is it known for?Despite its expensiveness, for visitor and resident alike, London is a very approachable city, with free entry to many of its world-class museums, an easy-to-understand public transport system, unpretentious farm-to-table gastro-pubs, public access to famous buildings like Westminster Abbey and Buckingham Palace and endless acres of well-maintained parks.

London can look like a storybook city to a new visitor, but behind the façade of gray palaces, red buses and black iron railings, is a vast city of numerous neighbourhoods that are often villages unto themselves. Sure, there is wonderful theatre and constant cultural events, but it is the street fashion in Dalston, pop-up restaurants in Borough, roof-top farm/art installations in Shoreditch and literary salons in Notting Hill, that are among the joys of living here.

Where do you want to live? Most people find living in Zone 1 (the area inside the Circle Line Tube route) neither desirable nor affordable. While getting a hotel room near Oxford Circus is convenient for a few nights' stay, when you live in London, quiet streets and some greenery are much sought after.

There are more than 600 square miles and hundreds of neighborhoods in London and deciding whether you want to live east, west, north or south is truly a personal choice. Many American ex-pats live in the west London areas of Notting Hill and Holland Park, while many wealthy second-home owners buy in Kensington and Chelsea. But with the Olympics in 2012, smart buyers are looking east to the borough of Hackney and the construction going on from Stratford to Leyton. The new East London line recently connected the neighborhoods from Shoreditch to Dalston to the Underground and urban renewal plans for streets and blocks of flats are being put into place. In south London, Brixton, Streatham and Camberwell continue to move up in the housing market.

Side trips The only thing that is really a factor in travelling from London is time. Do you want to take a two-hour train journey to Paris or a two-hour flight to Portugal? Do you want to spend four hours to get to Edinburgh or the same amount to get to a coastal village in the heart of Devon? You could spend weekends walking the sheep-cropped hills of Shropshire or Wales, or the boulevards of Barcelona or Madrid. Dubai, Oman and other Middle East points are about seven hours away, and New Delhi only eight.

And, of course, London is so large you can spend whole days exploring neighborhoods like Greenwich, London Fields and Peckham, and feel like you are discovering someplace new and exciting.

Practical info Although the recent recession brought house prices down slightly, it was from the stratospheric heights reached in 2007 and 2008. "The market is very strong and the international buyers especially are taking advantage of the weak pound," said Thomas Holcroft, a director at Savills UK.

London's housing stock runs the gamut from a modest converted Victorian flat to the most expensive apartments in the world at One Hyde Park in Knightsbridge (one bedroom starts at £6.5 million). Holcroft said that many foreign buyers prefer portered buildings, so they have the reassurance of security and maintenance, along with amenities such as a fitness/leisure centre, parking and someone to take deliveries. However, these come with high maintenance fees and without many of the period details of the Victorian or Georgian conversions.

Housing prices are headed back up on all fronts. "Everybody is pushing up the prices," said Holcroft. "There is only a finite amount of period properties and lots of demand." In west London, he considers North Kensington to still be quite good value for money, but for real bang for the Olympic buck, think east.

Further reading Transport for London (www.tfl.gov.uk): Do not leave home without checking your Tube or bus status.